Microsoft announced today that it has taken an interest in the Kindle competitor, Barnes & Noble’s Nook e-reader. That is, a $300 million interest. That is how much Microsoft has announced that they are investing in the Barnes & Noble device. They have also announced Windows 8 will come pre-loaded with a Nook app.
The investment is driving the formation of a brand new entity that is a partnership between Microsoft and Barnes and Noble.
Observes James McQuivey, an analyst with Forrester Research, “Obviously this is a ploy by two players who are behind the leaders in their respective markets to join forces in hopes they can balance out each other’s weaknesses. If they really push it – and it’s a big if because it’s really Microsoft that would have to push the Nook business into all of its other platforms, including the Xbox – this could be Microsoft’s attempt to compete with iTunes. But that will require an appstore as well, which is another important piece that they don’t have. But you have to start somewhere.”
The question is, will they finish ahead of – or even on par with – Amazon and Apple?
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